By Dr. Chen Man Hin

PM NAJIB MUST INTENSIFY HIS EFFORT TO IMPROVE THE ECONOMY QUICKLY OR THE PEOPLE WILL SUFFER MORE WITH INCREASING UNEMPLOYMENT BECAUSE OF POORER BUSINESS ACTIVITY, CLOSURE OF MANUFACTURING INDUSTRIES, UNEMPLOYMENT AND LOWER INCOME TO BUY FOOD AND ESSENTIALS FOR THE FAMILY

The world economic credit crunch and economic downturn has begun to create havoc for the malaysian economy, and this despite the announcement of two stimulus financial packages and liberalisation of services.

On becoming Prime Minister, Datuk Seri Najib Razak proudly announced his 1 Malaysia, People First and Performance Now program. He was quite sure that the economy would not be affected by the global crunch.

However, with the fanfare and the shouting over, the economy has not shown signs of getting better. On the contrary it is getting worse.

PM Najib has recently admitted that ‘Malaysia had experienced a 6.2 percent contraction in the GDP in the first quarter of this year, with a similar contraction expected for the second quarter.’

He revised the contraction for the whole year 2009 to be from -1% to a contraction between 4 and 5 per cent. Independent analysts expect a 7% contraction.

SEVERE CONTRACTION OF BUSINESS INVESTMENTS

The global recession has caused a sharp drop of manufacturing exports, causing many factories to close down.

The hope for foreign and domestic investments to counter a recession has fallen flat. Najib revealed that last year there was a drop of 21% in foreign investments. For this year, he expected FDIs (foreign direct investments) to drop by 50 – 60%. Foreign direct investments are shrinking around the world and Malaysia has to compete with other countries of the world for a diminishing foreign investments cake.

Najib made a high-profile visit to China. Other than signing a plethora of MOUs, he did not bring back any substantial foreign investments.

The main reason for the failure to attract FDIs is the New Economic Policy, which has driven away foreigners who were initially attracted to invest in Malaysia.

NAJIB’S INDECISION TO INTRODUCE GENUINE LIBERALISATION TO THE ECONOMY IS A MAJOR CAUSE OF THE PRESENT CALAMITOUS ECONOMIC SITUATION.

He has offered some cosmetic measures like liberalising the services sector which are useful but will not attract foreign investments that really matter. The reason why Malaysia and United States of America could not reach a free trade agreement (FTA) is the matter of procurement, which the NEP cannot liberalise, as it is a policy matter to protect bumiputra investors.

The Prime Minister is in a dilemma which he openly admitted. If he were to remove the NEP, he would be damned by the bumiputras. If he does not, he would be damned by foreign investors.

NATIONAL INTEREST AND ECONOMIC SURVIVAL MUST COME FIRST. THE FIRST AND BASIC PRINICIPLE IS THAT THE ECONOMIC CAKE MUST GROW FAST IN ORDER TO HAVE SUFFICIENT PORTIONS FOR ALL TO BENEFIT FROM.

40 years of the NEP has revealed the stark fact, that the national economy has suffered when compared to other Asian countries like South Korea, Taiwan, Hong Kong and Singapore. Their economies have been leaping forward but Malaysia has been limping along.

40 years ago Malaysia had the second highest per capita income in Asia after Japan. Today Malaysia is way behind with a nominal pci of US$6,000 compared with S Korea USR$19,000, Taiwan US$18,000, Hongkong US$30,000 and Singapore US$34,000. Bear in mind that Malaysia has vast natural resources with zero resources for Hong Kong and Singapore. Without the natural resources, Malaysia would be a banana republic.

PM NAJIB MUST ENGINEER AN ECONOMIC POLICY THAT WILL ALLOW FOR UNLIMITED GROWTH AND PRODUCTIVITY, SO THAT ALL MALAYSIANS CAN ENJOY A BETTER LIFE. GROW THE ECONOMY FIRST AND THERE WILL BE ENOUGH FOR DISTRIBUTION..

Najib’s visit to China should have opened his eyes and found out what made China tick to become the third largest economy after USA and Japan. The secret of China’s giant leap from 1974 as a poor Asian couintry to become an economic giant lies in its policy of liberalisation and a market economy. It gave up its socialist economy for a market economy like Usa and Japan.

MALAYSIA MUST LIBERALISE AND GIVE UP THE OLD NEP FOR A LIBERAL MODERN MARKET ECONOMY AND JOIN THE WORLD OF DEVELOPED NATIONS.

FOR BUMIPUTRAS, THE CONSTITUTION GUARANTEES THEM PROTECTION AND ASSISTANCE FOR THE POOR AND UNDERPRIVILEGED, EDUCATION AND GUIDANCE TO WEAN THEM AWAY FROM HANDOUTS, AND LEARN TO BE ACHIEVERS AND WINNERS.

THE DAP URGES THE PRIME MINISTER TO DECIDE AND ACT NOW OR MALAYSIA WILL SINK DEEPER INTO THE MORASS OF POVERTY AND ECONOMIC RECESSION.